Why Target is Missing the Canadian Target and 3 Ways to Fix It

We all read the headline this week: only 27% of Target customers in Canada are satisfied. For comparison, 62% of Costco customers in Canada are satisfied.

All seemed well for dreamy Tar-shay in the United States but not so much for that big slice of friendly land above us. This is interesting news that could go one of two ways: Target Canada is doing something wrong in the Canadian market or the Canadian market is slowing.

Which it is. David Rosenberg, prince of Bloomberg and famed chief economist strategist at Gluskin Sheff & Associates, listed problems in the Canadian economy as number #6 on his list of worrisome economic trends right now.

But Target Canada is also doing something wrong. Two things actuallyâfirst, they are replacing the homegrown store Zeller's (even taking over leases for their stores) causing Canadian resentment and second, having supply chain problems. Apparently, the sales are great but there simply aren't enough products to support the inventory.

Clearly, Target isn't wowing a lot of Canadians right now; a problem exacerbated by a weakening market.

What can be done? Well, in my humble opinion I would recommend the following strategies.

1. Establish Target Canada not as a satellite of American culture abroad but as something more precisely Canadian. This would help lower resentment surrounding the takeover of Zeller's market share. Target not just low prices but the culture itself.

2. Fix supply chain problems. This means not relying too heavily on US warehousing but rather, establishing this supply chain forcefully in Canada. This would create jobs for Canada held by Canadians.

3. Love customers with a great CRM system. Who's to say that Target can't have a different CRM and loyalty strategy in Canada than in the US? In fact, I think this is necessaryâTarget Canadians need to feel the customer love more so than US Target customers.

Comments

Another problem is that Canadians see US commericals on Canadian TV on a daily basis. Many people thought the prices here would be the same as they are in the US. Obviously, that’s not possible. In addition, I myself was in a Target here in Calgary a couple of weeks ago and it looked disorganized and junky….. just the way Zellers did as it came closer and closer to failure. That makes customers unwilling to go back, since it’s hardly a positive experience.

Thanks for sharing Tammy. That’s fascinating! I wonder why they wouldn’t change the prices over..not too good for CRM I’d say. Canada is it’s own market, not just a satellite for pipelined US brand introductions.

Target Canada should formulate some strategy to keep the stores “afloat” because I do worry that at this rate it could “spell” the demise of Target Canada.It’s bad enough that it’s been 15 years since Kmart Canada failed even though Kmart Canadian outlets have lasted for many years so therefore I hope Target Canada won’t end up experiencing a similar fate.